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Increase to Minimum Wage as of April 1st 2021

The minimum wage rates (before tax) are as at 1 April 2021 and apply to employees aged 16 years or over are:

Type of minimum wage (weekly rate assumes 40 hour week)

Adult = Hourly Rate $20.00 = Weekly Rate $800.00

Starting Out = Hourly Rate $16.00 = Weekly Rate $640.00

Training = Hourly Rate $16.00 = Weekly Rate $640.00

Adult Rate
The adult minimum wage rate applies to employees aged 16 years and over.

Starting-out Rate
The starting-out minimum wage applies to workers who are:

  • 16 and 17 year-old employees who have not completed six calendar months of continuous employment service with their current employer.
  • 18 and 19 year old employees who have been paid one or more social security benefits for six months or more, and who haven’t completed six calendar months’ continuous employment with an employer since they started being paid a benefit.
  • After six months with one employer they are not starting-out workers and must be paid the adult minimum wage.
  • If an employee is supervising or training other workers, then the starting-out minimum wage rates do not apply, and they must be paid at least the adult minimum wage.
  • There is no minimum wage for employees who under 16 years of age. If you employ under-16s, you must not let their work get in the way of attending school.
  • Aged16-19 and required by their employment agreement to undertake industry training for at least 40 credits a year to become qualified.

IMPORTANT NOTES:

Training Rate:
The training rate applies to employees aged 20 years or over whose employment agreement states that they must do at least 60 credits a year of an industry training programme to become qualified in the area they are working in. Many of these employees will be apprentices. An apprentice has the same minimum rights and protections under employment law as any other employee but may be paid the training wage.

This rate does not apply to employees who are being trained at work, for example, by their employer at the start of their employment; it only applies to employees doing an approved industry training programme.

If an employee is supervising or training other workers, then the training wage rate does not apply, and they must be paid at least the adult minimum wage.

What action you need to take:

  • If you do have staff on minimum wage, send them a letter or email to let them know about the increase.
  • If any workers are on starting-out or training wages, now is a good time to check when they’ll be eligible to move to the adult rate.
  • If you pay staff minimum wages, recalculate your budget for the rest of the year, as you’ll be paying out more in wages. To work out the updated cost of your employees, use the Employee cost calculator.
  • Check that any affected employment contracts are updated.
  • Talk to whoever runs your payroll system to make sure they’re ready for the changes.
  • If your payroll and employment agreements are a few years old, you can use this as a chance to update them too. Note that it is a legal requirement to have a written employment agreement with all your staff.
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